Rajat Gupta's bid to hold on to a private-equity firm he co-founded with a former friend was thrown out of court last week.

U.S. District Judge George Daniels dismissed Gupta's lawsuit, filed earlier this year, noting that New Silk Route Partners co-founder Parag Saxena had not actually kept Gupta from naming a representative to the firm's board. The judge said that whatever Saxena's intent, it was "not what is currently before this court."

Gupta, the former head of McKinsey & Co. who was convicted last year of passing confidential information to Galleon Group founder Raj Rajaratnam, alleged that Saxena sought to deprive him of his right to appoint one of New Silk Route's two board members. Gupta accused Saxena of trying to remove his appointed director and of effectively blocking the appointment of a replacement.

Since then, however, a Gupta nominee has been seated on the firm's board.

Gupta agreed to step down from the board and give up his title as chairman after he was charged with insider-trading. He is currently appealing his conviction and two-year prison sentence. Rajaratnam was also involved in founding New Silk Route.

Daniels made clear that he was not ruling on the merits of the case. But while he said that Gupta could bring a new lawsuit against Saxena should the latter block a future board nominee, he made clear that he wasn't impressed with Gupta's arguments.

"Quite frankly, I have a dim view of the merits of this claim," he said.

"The purpose of filing this action was to have a designee on the board," Rishi Bhandari, who sparred with Daniels over the meaning of Gupta and Saxena's agreement, said. "If they do anything to impair Mr. Gupta's rights, we can still sue to stop them."

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